Case note: Don't pay the Ferryman*

Australian Maritime Officers Union v Sydney Ferries Corporation [2009] FCAFC 145 (15 October 2009).

A unanimous decision of the Full Court of the Federal Court has upheld an appeal in relation to whether income protection provisions contained in a Workplace Agreement were prohibited content.  The Judge below found they were, and as a consequence the provision did not apply.  The provision related to the Workplace Agreement, which bound the Sydney Ferries Corporation with its Maritime Officers.  In accordance with the Agreement, Sydney Ferries agreed (at [1]):

“To insure its Maritime Officers for income protection insurance for long term illness and injury equivalent to 75% of his/her salary after a three month qualifying period commencing as soon as practicable after the lodgment of the Agreement.”

Sydney Ferries did not honour the Agreement which it had made, and pleaded in its defence, that the relevant term under consideration contained “prohibited content” which could be identified by regulation (s 356(1)(f) of the Workplace Relations Act 1996 (Cth)).  The union appealed, and strange to relate the employer, which had been successful below, did not appear at the appeal and lamentably was not able to act as a contradictor to the Appellant’s submissions (at [6]-[7]).

The Full Court analysed a number of High Court decisions which related to whether or not a particular claim could sit within an industrial dispute, in that the claim needed to pertain to the relations of employer to employee.  In order to uphold the appeal, the Full Court relied upon the High Court decision of Re Manufacturing Grocers’ Employees Federation of Australia; Ex parte Australian Chamber of Manufactures (1986) 160 CLR 341 and relied upon what was said at 353 being:

“For present purposes, it is sufficient to say that a matter must be connected with the relationship between an employer in his capacity as an employer and an employee in his capacity as an employee in a way which is direct and not merely consequential for it to be an industrial matter capable of being the subject of an industrial dispute.”

The Full Court found (at [19]) that:

“A matter of considerable importance is that the agreed term provides a benefit to employees during their employment, even though it might also generate a benefit to them after employment has ceased.  No obligation is imposed on SFC [Sydney Ferries], or any immediate right created for employees, outside the period of employment.  Even a post-employment benefit would depend upon the happening of an entitling event (accident, injury or illness) during a period when a policy was in force – ie during employment pursuant to an agreed obligation to pay the necessary premiums.”

The Full Federal Court was at pains to note that this income protection case was not one in which they intended to lay down any general rule and each matter must depend upon its own circumstances (at [8]). The employees of the Sydney Ferries Corporation, who must have one of the best jobs in the country daily plying Sydney Harbour, have had a good win.

* Thank you to Chris de Burgh.